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Rising energy prices could make microgeneration viable

Rising energy prices could make microgeneration viable

Microgeneration could pay for itself within a decade or two if energy prices continue to rise radically and Government introduces a carbon tax, according to a sustainability expert.

Ian Butterss, of consultancy firm Faithful+Gould, said many calculations about how long it will take for renewable energy sources such as solar panels to pay for themselves do not take account of how quickly energy prices are rising.

Speaking at the Ecobuild exhibition in London, he said microgeneration technology was also likely to come down in price in the coming years, meaning that when replacements and maintenance are needed, it will cost less.

"None of these technologies pay back their cost if you do not take into account rising energy prices and a carbon tax," Mr Butterss said.

"It is so important that we get to grips with it. Have a cost analysis without it, and we wouldn't do any of these things."

Energy prices have doubled in the last two years, Mr Butterss said, and it is not unlikely that they could double again within the next five years - an annual growth rate of 7%.

Growing energy demand from India and China, and increasing scarcity of oil will also help to drive prices up, and this must be factored into purchasing decisions, he argued.

His estimates also took into account the introduction of a carbon tax, as the Conservatives and the Liberal Democrats are in favour of it, and although Gordon Brown has not made any moves to introduce one, the Labour-commissioned Stern report backed the idea.

Technology prices are also expected to fall, with some experts predicting that photovoltaic panels could drop to 20% of their current cost.

Kate Martin


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